The North Kingstown Cancer infusion therapy division expects tremendous growth over the next year and is projecting the following cost and rate structure for the service.
|
Revenue |
$750 per patient |
|
Costs: |
|
|
Rent |
$3,600 per month |
|
Staff |
$195,000 per month |
|
Leases |
$10,000 per month |
|
Other fixed costs |
$20,000 per month |
|
Pharmaceuticals |
$500 per patient |
|
Intravenous supplies |
$25 per patient |
|
Other patient supplies |
$25 per patient |
a. What volume of patients per month will it take for the center to break even?
b. What is the break-even point in dollars?
c. Graph the above scenario using a range of 0 to 2,500 patients in 500-patient increments.
d. If the clinic needs to make a profit of $75,000 per month, what is the new break-even point in volume per month?
e. If the clinic needs to make a profit of $75,000 per month, what is the new break-even point in revenue?